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Not-for-profit hospital and health system leaders are currently monitoring a flurry of rapidly evolving potential changes to state and federal policy with significant, long-term financial ramifications for their organizations.

As hospitals and health systems respond to the challenges and opportunities of a stabilizing but still challenged market environment, their strategic and financial plans will inevitably change.

With extension of the 2017 tax cuts identified as a key priority for the incoming Trump administration, offsetting expense actions will be needed to avoid increasing the federal deficit. Hospital leaders should be prepared for potential cuts to both the Medicaid program and the enhanced ACA subsidies enacted in 2021.

As hospitals and health systems intensify their financial planning efforts, revisiting and refining the forecasting techniques and tools that guide their decisions has become paramount.

As organizations increasingly adopt a service line planning model, integrated strategic financial planning is more critical than ever.

Strategic planning and financial planning are highly interrelated and interdependent disciplines. Institutional financial literacy creates the perfect environment and means of communication in which an integrated strategic financial planning process can thrive.

Promoting financial literacy serves two important purposes. First, it makes everyone aware of the institution’s current financial health. Second, it makes everyone aware of what will be required to ensure the institution’s financial health over the long term.

In recent years, many healthcare organizations have invested less effort in long-range financial planning to confront more immediate challenges to their margins and balance sheets.

Since the late 1980s, financial planning has been a core focus of Kaufman Hall’s work. A recent leadership change emphasized the importance of financial planning to the for-profit corporate world. It should be given similar priority in the not-for-profit hospital universe.

In this week’s graphic, we use data from Kaufman Hall’s National Hospital Flash Report and Syntellis Market Insights to assess the current state of hospital operating margins.

This past year in higher education has been fraught with challenges, both new and chronic. A focus on objective assessment, planning, and preparation will be vitally necessary to survive the ever-changing weather of higher education.

Higher education is facing a crisis of confidence in the value of a college degree, with risk implications for enrollments, tuition pricing, and capital spending. Avoiding these risks begins with finding and quantifying the appropriate “corridor of control” for your institution.